Views: 3 Author: Site Editor Publish Time: 2023-07-24 Origin: Site
The upstream of the printed circuit board (PCB) manufacturing industry mainly consists of raw material manufacturers such as copper foil, wood pulp, fiberglass yarn, resin, etc; The midstream mainly consists of PCB manufacturers, with copper clad plates being the core raw material for PCB manufacturing; Downstream mainly include companies in fields such as communication, electronics, semiconductors, and computers.
Upstream and midstream: PCB raw material costs have fallen, and CCL manufacturers are building a foundation
The main raw materials for PCB and CCL include copper foil, epoxy resin, and fiberglass cloth. In addition to labor and manufacturing costs, PCB raw materials mainly include copper clad plates, copper foil, phosphor copper balls, solder resistant ink, etc. Copper clad panels account for the highest proportion of PCB raw material costs, reaching 30%. The main raw material for copper foil is copper, and since 2023, LME copper spot prices have fluctuated and declined.
The prosperity level of the upper and middle tier A-shares on the PCB is low. Copper prices have fluctuated downward, with epoxy resin and electronic grade fiberglass fabric prices at relatively low historical levels. Affected by the continuous decline in prices, the main targets of copper foil, fiberglass cloth, and epoxy resin experienced lower than expected revenue and net profit recoveries for the entire year of 2022 and the first quarter of 2023. The overall copper clad board is still in the bottoming period, and the revenue and profits of major A-share listed companies continue to decline. The CCL sector needs to wait for a rebound in downstream demand and the emergence of new demand growth points to drive an orderly recovery of the sector
Downstream PCB manufacturers: tracking production and sales, inventory, and expansion status
The production and sales of major domestic PCB manufacturers are relatively stable, waiting for the demand turning point after the inventory is cleared. In 2022, the production and sales of major domestic PCB manufacturers are relatively matched. In terms of sales, most major domestic manufacturers have maintained stable sales, with Xingsen Technology's sales growth rate reaching 7.27% in 2022. In terms of production, Dongshan Precision has seen rapid growth, with a growth rate of 4.99%. From the perspective of product area and output value, the production of Jingwang Electronics has reached 9.2697 million square meters, and the production of Pengding Holdings has reached 27.1 billion yuan. Stimulated by the overall prosperity of the PCB industry and objective factors, manufacturers have previously tried to prevent supply chain risks from causing inventory pressure. We believe that the gradual digestion of inventory levels will be beneficial for the PCB industry to recover.
Downstream prosperity trend: Stimulating PCB demand in multiple sub sectors in multiple fields, paying attention to changes in market space and competitive landscape
The main downstream applications of PCB include communication, consumer electronics, automotive electronics, computers, industrial control and medical, and military aerospace. According to Prismark's statistics, in 2021, the largest downstream application in the global PCB industry was computers, accounting for 34%; Next is the communication industry, accounting for 32%; The consumer electronics industry ranks third, accounting for 15%.
Consumer electronics: We are optimistic that global electronics will enter the innovation cycle, boosting the demand for FPC soft boards. The recovery of consumer electronics demand and the innovation of various segmented products will bring broader market space for PCBs. Consumer electronics includes segmented product areas such as mobile phones, computers, smart homes, and wearable devices. With the rapid development of the global consumer electronics industry, new consumption hotspots emerging from new series of products such as smart phones, tablets, wearables, AR, VR, etc. will lead a round of iterations of Consumer electronics, thereby driving the demand for PCBs.
Automotive Electronics: New Energy Vehicles and Automotive Electronics Enhance PCB Demand
The new development trend of electrification, intelligence, networking, and sharing of intelligent vehicles will drive the growth of the overall industrial chain. Currently, the penetration rate of new energy vehicles in China is high, and the automotive electronics market is large. The development of intelligent vehicle electrification will empower the development of the three core systems of new energy vehicles: batteries, motors, and electronic control. Thanks to the drive of the "four modernizations" of automobiles, the value of a single car's PCB has increased to around 1200 to 3000 yuan. Taking the median price range of 2100 yuan per vehicle, we expect the market space for new energy vehicle PCB in China to increase from 1.196 billion yuan in 2019 to 13.494 billion yuan in 2025, with a CAGR of 49.76%.
Communication: AI server has a large increment, pay attention to the progress of verifying card slots by domestic manufacturers
The increasing demand for AI servers has brought development space to the PCB market, and the demand for high computing power will put forward higher quality requirements for PCBs. PCB is mainly used for internal motherboards, power backboards, hard disk backboards, network cards, Riser cards, etc. in servers. With the continuous improvement of server requirements for computing and transmission speed, PCB will usher in new upgrades and innovations, and drive incremental demand in the PCB market. According to Prismark's prediction, the global PCB output value will reach 101.6 billion US dollars in 2026, with a compound growth rate of approximately 4.8% from 2021 to 2026; In 2026, the output value of PCB in Chinese Mainland is expected to continue to maintain the position of the region with the highest output value of PCB in the world, reaching US $54.6 billion, with a compound growth rate of about 4.6% from 2021 to 2026.
